Recycling data shows aluminium PRN market has been ‘distorted’, says Alupro

Aluminium recycling organisation Alupro has criticised the high Packaging Recovery Note (PRN) price for aluminium packaging in 2019 in light of record aluminium recycling figures.

Provisional data published by the Environment Agency (EA) on 10 January has indicated that the aluminium packaging recycling target of 112,00 tonnes (61 per cent) has been exceeded, with 114,748 tonnes reported as collected for recycling – a 15 per cent increase on 2018’s figures.

Stacks of aluminium drinks cans.The data, which is due to be finalised in March 2020, indicates that Q4 was the strongest quarter of the year and the highest ever recorded, with around 34,000 tonnes of aluminium packaging being recycled. It is anticipated that official figures will be higher once finalised and will result in a significant carry-over towards 2020’s target of a 64 per cent recycling rate.

The provisional results and quarterly data released by the EA throughout 2019 suggest that more than enough material was recycled to generate sufficient PRNs on aluminium packaging, but that organisations refrained from issuing these PRNs, which then artificially inflated prices.

Aluminium and plastic PRN prices skyrocketed in 2019, reaching as high as £500 per tonne for aluminium, despite what now appears to be sufficient recycled tonnages. The EA’s provisional data suggests a surplus of at least 6,000 tonnes of recycled aluminium packaging.

Alupro raised concerns about the artificially high PRN prices in a joint industry letter to the Department for Environment, Food and Rural Affairs (Defra) in December last year, which highlighted the concerns of food and drink and packaging manufacturers across the retail industry.

Commenting on the data, Rick Hindley, Executive Director for Alupro, said: “The data clearly demonstrates another impressive increase in the volumes of aluminium packaging collected and recycled – we anticipate that the final reported figure will be higher, which has been the case in previous years. It is excellent news that the target has been exceeded and the sustained growth of aluminium packaging recycling continues, but the data again clearly suggests that the aluminium PRN market has been distorted.

“The abnormally high PRN price has significantly impacted producers and once again brings into question the system itself. Aluminium is a sustainable material, yet the market distortion caused by organisations holding back PRNs in order to force prices to artificially high levels, undermines the aluminium packaging industry. We are eager to see what additional investment to support further increases in aluminium packaging recycling and collection will result from the hugely increased revenues received by some aluminium recyclers and exporters last year.”

Alupro has put on record its support for the Advisory Committee on Packaging’s (ACP) calls for a compliance fee for packaging to restrict excessive pricing and volatility in the PRN system and offer businesses an alternative route to compliance in anticipation of reform of the producer responsibility system, which is currently still being worked out.

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